Billionaire Kirk Kerkorian will be crowned king of Las Vegas if he buys the Mandalay casinos – but Mandalay’s two founders would be the big losers in the deal.

Kerkorian and his casino company, MGM Mirage, are offering $4.85 billion for Mandalay Resort Group, hoping to create the world’s largest gaming empire.

Although the deal ignited a Wall Street buying frenzy for Mandalay stock – sending it soaring 16.5 percent yesterday to a new high of $70.23 – its two creators appear to be suffering from a case of bad timing.

Chairman Michael Ensign, 66, and Vice Chairman Bill Richardson, 57, spent 14 years building Mandalay into the casino powerhouse that Kerkorian now craves – at a stiff premium – but the two began to unload most of their sizeable stakes about a year ago.

Had they not folded their hands, the two would have reaped separate windfalls of nearly $166 million on their stock yesterday.

Instead, they cashed out for what seemed to be a sure thing, selling for gains of about $43 million each over the past year.

All the while they sold shares, Mandalay stock continued to climb, rising about 132 percent in the past year.

Richardson still owns about 300,000 shares and Ensign still owns about 405,000 shares, valued at $21 million and $28.4 million, respectively.

Some casino analysts think a Kerkorian merger may get mired in ego struggles.

Ensign and his counterpart at MGM Mirage, Terry Lanni, would be competing for the top spot at the merged company.

“Some executive egos are on the line and could derail some of the deal,” said Roger Gros, an analyst and editor of Global Gaming Business. “There’s been a history of bitterness between them for years,” he said.

Ensign even resigned in protest from the industry trade group, the American Gaming Association, because he felt Lanni had too big a role on its board.

The merger would give a combined company at least 11 major gaming properties, some of which may be sold due to antitrust concerns.

MGM and Mandalay already jointly own the big Monte Carlo casino on the Las Vegas Strip.

MGM, which has five casinos on the Strip – New York-New York, Bellagio, the Mirage and Treasure Island, plus the MGM Grand – might have to divest its Treasure Island property, as well as assets in other states. Mandalay would probably have to sell its Circus Circus group.

“The antitrust people at the Justice Department are going to go over this with a fine-toothed comb,” said Gros.